KL Juice Bar Ch23

1) KL Juice Bar uses juicing machines, fresh fruits, and two workers to produce drinks and snacks on site. They could improve efficiency by hiring more employees to reduce wait times or using automated machines for faster, more consistent production. 2) KL Juice Bar could also improve effectiveness by increasing juice quality to meet customer needs and wants, and reducing wait times, which would improve the business by gaining a competitive advantage through happier customers. 3) Transitioning to capital-intensive production could increase KL Juice Bar's revenue and growth through higher production volumes and quality consistency, but they lack the financing as a new business, and it's harder to maintain customer loyalty without face-to-face interaction.

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KL Juice Bar Ch23

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1) a) i) A business can increase the added value of a product by adding a new feature

to it.

ii) Labour is the workforce and productivity is how much the employees produce
over a period of time, therefore labour productivity is how much (the workforce
produces in a certain period of time.

b) i) 600

ii) The transformational process that is used at KL Juice Bar are the inputs that
include juicing machines, fresh fruits and then the two workers make the drinks handmade
on the premises. They also sell snacks which they produce on the premises.

c) KL Juice could improve their efficiency by having more employees to make the
drinks so that the consumers do not have to wait in very long queues. They also could
improve their efficiency by using automated machines that make the juices a lot quicker and
will extract all the juice in them so the bar would therefore lose less money and grow a lot
easier. Furthermore, since the consumers are complaining with the low quality juices and
snacks, using automated machines will decrease that problem as the juices would be made
perfectly and quicker. Seeing as the employees recruited by KL Juice bar are not skilled the
drinks can’t be good.

KL Juice Bar could improve their effectiveness by increasing the quality of the juices to meet
customer needs and wants, the bar could also by decreasing the waits to order and get the
juices to improve the effectiveness of the business. By doing this effectiveness would be
improved which means that the bar will gain a competitive advantage over the market and
help the business to grow, get more sales and have a better relation with the consumers as
their wants are being fulfilled. Moreover, the customers would be happy to not wait in the line
to have good quality juices.

d) Benefits of KL Juice Bar’s production process going from being labour intensive to
capital intensive is that they could make a lot more revenue and grow as well and they are
producing a lot more with the use of a lot of machinery compared to employees. The
production of goods and the quality will be consistent meaning that Raj and Ameer’s
business would grow as production increases and since they have free advertising this could
be a lot easier to attract new customers with a wider range and better quality juices and
snacks. Furthermore, the amount of consumers would increase again because they fell from
300 to 200 after two months of the business startup. If the bar uses good quality juice
machines they would break down a lot less easily and will also limit the poor attitude
amongst the workers as there will be less employees.

Disadvantages of KL Juice Bar’s production process going from being labour intensive to
capital intensive is the lack of finance as the business is only a startup business. If the sales
of the juices do not increase when changing the production process the business could fail
because of the lack of profits. When having a capital intensive business, keeping customer
loyalty is harder because you don’t see them face to face which is one important way of
keeping consumers happy by meeting their needs and wants.
To evaluate, I would recommend Raj and Ameer to keep being a labour intensive production
to keep a good quality handmade juices and snack, they just need to employ more skilled
employees or introduce the new employees by doing some training with them, either on or
off the job. Thus helping to maintain good quality and quick production of the juices and
snacks, as the employees would know exactly what to do to produce the goods. Labour
intensive would also mean a lot of face to face relationship with the consumers which would
help the business gain loyal consumers and gain competitive advantage.